Tech Founder’s Portfolio Reveal: Goldman Sachs Vs Private Ventures Vs S&P 500 Index Fund — Who Won?

Tech entrepreneur Ankur Nagpal has shared a story of his financial experiment with high-net-worth wealth management, revealing that a simple S&P 500 index fund outperformed both his personal trading and a portfolio managed by Goldman Sachs over the last five years.

Nagpal, who sold his startup Teachable for roughly $250 million in 2020, in a viral post on X, has offered a transparent glimpse into his "five-year financial experiment", which involved two distinct strategies.

Upon exiting his company, Nagpal had allocated 50% of the proceeds to Goldman Sachs for professional wealth management while retaining the rest to manage himself, through venture investing, stock picking and crypto.

The bottom line, according to data shared by Nagpal, is a victory for passive investing.

The tech founder revealed that the professional help through Goldman Sachs handed him an annualised Internal Rate of Return (IRR) of 10% during this period, whereas Nagpal's self-managed portfolio performed better at 14% IRR.

However, what was shocking is that both portfolios underperformed S&P 500 IRR of 18% during this period.

"I can sit here and complain about how I underperformed the S&P," Nagpal wrote on X. "Or I can moan about the fees Goldman has charged me."

The tech founder pointed out that Goldman Sachs portfolio faced a management fee of approximately $3,000 alongside percentage-based product fees - including a small-cap fund with a 1.5% expense ratio that returned only 7%.

"To pay ~100bps a year to index the market dramatically chips away at your returns," Nagpal wrote.

While his personal portfolio was boosted by a 390% gain in crypto assets and strong venture returns, it was dragged down by individual stock picks in 2021 and 2022.

Having failed to generate the desired returns, Nagpal stated that he plans to cut out the middlemen going forward by 'direct index' for the majority of new assets.